Fog? No problem. Smoke? No problem. Glass? Problem.
Seriously, thermal offers some pretty big advantages over gen 3. If you're trying to spot an animal or person through vegetation or foliage, especially on a night with no moon and cloud cover, a good thermal device is what you want. This is why hog and coyote hunters pick thermal over gen 3. In that application a thermal scope or high-end thermal clip on makes it much easier to find and target the animal. A high-end gen 3 scope or clip on works great for open terrain and in my opinion is way cooler then using a thermal scope for sniping, but the fact is you'll be able to hit more targets using thermal. Heat sources simply just stand out better. Coyotes or well camouflaged people that blend in to terrain and are hard to see during the day are equally hard or more so at night under gen 3.
Ideally, have both!